Investing alongside you, fellow Foolish investors, here’s a selection of shares that some of our contributors have been buying across the past month!
Amazon
What it does: Amazon is the world’s largest online retail platform. It also has a significant cloud computing business.
By Stephen Wright. The stock market had a bit of a wobble recently as a strenghening Japanese yen caused a selloff in US stocks. I used the opportunity to add to my investment in Amazon (NASDAQ:AMZN).
I’m impressed with the way things are going with the company at the moment. Weak consumer sentiment might be weighing on revenues, but it’s growing in all the right places.
During the second quarter of 2024, sales from online stores grew 5% as consumers looked to trade down. With this being the largest segment, a prolonged recession in the US is a real risk.
Elsewhere, though, revenues grew 19% from cloud computing and 20% from advertising. Over the long term, I expect these to be highly profitable, so the growth there looks promising.
Ultimately, disrupting Amazon’s competitive position is going to be a huge undertaking for any business. That’s why I’m always keen to buy the stock when I see an opportunity.
Stephen Wright owns shares in Amazon
Amazon
What it does: Amazon is a technology company that operates in the e-commerce space. It has further expanded into artificial intelligence and cloud computing.
By Charlie Keough. The Amazon (NASDAQ: AMZN) share price is down 14% in the last five days (as of 8 August) after continuing talks of a US recession has sparked a sell-off. I’ve used that as a chance to snap up some shares of the tech giant.
Its price also took a big hit after its latest earnings update. Revenue missed expectations and should a US recession come to fruition that could lead to a further downturn in spending. That’s a threat to watch.
But I think a chance to buy its shares at $162.7 is rare. It means the stock now trades on a price-to-earnings (P/E) of 39 and a forward P/E of 34.2. That’s a historically cheap valuation for the business.
Despite its recent blip, Amazon remains a high-quality business with plenty of earning power.
Often associated with online shopping, it does much more than that. I’m especially intrigued to see what moves it makes in the artificial intelligence space. It also continues to expand with its cloud computing services platform Amazon Web Services as well as the digital advertising market.
Charlie Keough owns shares in Amazon.
British American Tobacco
What it does: British American Tobacco manufactures and markets tobacco products worldwide under brands such as Lucky Strike
By Christopher Ruane. Has market sentiment turned on tobacco shares?
British American Tobacco (LSE: BATS) shares are down 9% over five years. But the price is up 19% so far in 2024.
Despite that rise, the dividend yield still looks juicy at 8.4%. The company has raised its dividend annually for decades, though that is not necessarily an indication of what to happen in future.
The risks remain significant. Cigarette sales volumes are falling in most markets and non-cigarette product formats have yet to prove anywhere near as profitable. Alarmingly, British American’s first half revenues fell 8.2% year-on-year. Still, it generated over £3bn in net cash from operating activities and adjusted net debt fell 12.4%.
But even given the risks, I think the shares continue to offer value. British American has a strong stable of premium brands, excellent distribution network and proven cash generation potential. I added a few more shares to my portfolio recently.
Christopher Ruane owns shares in British American Tobacco.
Card Factory
What it does: Card Factory is a value retailer with over 1,000 stores, selling a wide range of greeting cards and celebration essentials.
By Roland Head. Card Factory (LSE: CARD) is emerging from a difficult period with improved financials and solid sales growth. Revenue rose by 10% to £511m last year, while pre-tax profit climbed 25% to £65.6m.
The shares have bounced back from their lows but still look reasonably valued to me. Broker forecasts price the stock on eight times forecast earnings, with a 4.6% dividend yield.
This business ran into problems before the pandemic, but has been revitalised by chief executive Darcy Willson-Rymer. I think there’s still plenty of room for growth, as Card Factory expands its product ranges and improves its online performance.
Of course, there are risks. Having returned to health, sales might flatten out again, especially if consumer spending stays under pressure.
However, analysts expect profits to rise by 10% in this year and next year. I’m also positive. I think Card Factory’s proven model should support further gains for shareholders.
Roland Head owns shares in Card Factory.
Games Workshop Group
What it does: Games Workshop Groupis the premier tabletop gaming specialist with franchises like Warhammer 40,000.
By Royston Wild. I’m always looking for opportunities to buy great stocks when they fall in value. Games Workshop (LSE:GAW) is one such company I’ve just bought after recent bouts of price weakness.
Now the FTSE 250 share isn’t cheap on paper. At £104.10 per share, it trades on a forward price-to-earnings (P/E) ratio of 22.1 times. This sort of meaty valuation can leave it open to fresh price drops if market sentiment worsens or trading disappoints.
However, I believe Games Workshop is worthy of its premium rating. And I believe its shares — which have risen 125% in value in the past five years alone — have plenty of scope for further appreciation.
The business is the leading manufacturer and retailer of tabletop gaming miniatures on the planet. With its high-quality Warhammer game systems, it commands a large and growing fanbase that’s rapidly expanding as global interest in the fantasy genre picks up.
And it is looking to leverage the power of its intellectual property through a blockbuster TV and movie deal with Amazon. If successful, this could give profits growth a substantial shot in the arm.
Royston Wild owns shares in Games Workshop Group.
Glencore
What it does: Glencore is one of the world’s largest natural resource companies with operations across 35 countries.
By Andrew Mackie. The Glencore (LSE:GLEN) share price has been on a rollercoaster ride throughout 2024. Despite this, I view market volatility as an investor’s friend. That is why I bought more of its shares during the recent sell off.
The world is energy hungry. A recession isn’t going to alter this fact. Demand for energy is coming from multiple sources. Electrification of mobility is one key driver. It’s estimated that there will 500m battery electric vehicles in use by 2035. Demand is also being driven by electrification of residential heating and industrial processes.
As global demand for electricity soars grid infrastructure investment will need to be massively ramped up. The International Energy Agency predicts about $11trn will be required to shore up grids to make net zero targets a reality. This is incredibly bullish for commodities businesses like Glencore.
One of the major risks of investing in miners is ongoing challenges around obtaining permits and licences. It can take as long as 15 years for a new mine to come into operation. Over the long-term, however, this could lead to supply shortages, thereby pushing up metals prices.
Andrew Mackie owns shares in Glencore.
Phoenix Group Holdings
What it does: Phoenix calls itself the UK’s largest long-term savings and retirement business, with 12m customers and £280bn of assets under administration.
By Harvey Jones. I simply can’t resist the blockbuster dividend income on offer from FTSE 100 insurer Phoenix Group Holdings (LSE: PHNX).
At time of writing it yields a mighty 9.9% a year. At times, the yield can stray into double digits.
This is my third purchase this year. I bought Phoenix shares in January and March, too. Like Depeche Mode, I just can’t get enough.
So is the dividend safe? Well, Phoenix has a pretty good record of increasing dividends over the last decade. The balance sheet is solid and the business generates plenty of capital.
The dividend per share may only increase by a few percentage points each year but given the high starting point, that’s good enough for me.
The Phoenix share price is a bit of a mystery, though. It’s down 0.89% over the last year. I hope it’ll pick up when interest rates fall and the economy revives, but there’s no guarantee. Ah well, at least I’ll get the income.
Phoenix shares stock go ex-dividend on 26 September. I can’t rule out buying more before then. The next pay date is 21 October and I’m already looking forward to the wedge of cash hitting my account. I’ll reinvest it straight back into Phoenix shares.
Harvey Jones owns shares in Phoenix Group Holdings.
Uber Technologies
What it does: Uber is a technology company that offers mobility and food delivery solutions.
By Edward Sheldon, CFA. Uber (NYSE: UBER) shares have been up and down recently and I’ve been buying them on the dip.
There are a few reasons I’m bullish on this company. One is that it’s well placed to benefit from the growth of the travel industry over the next decade. When people arrive at an international airport, they often take an Uber to their hotel.
Another is that the company has started to roll out digital ads in its apps. Digital advertising can be very lucrative and exposure to this industry could propel Uber’s revenues and earnings much higher in the years ahead.
One risk I’m monitoring with this stock is Tesla’s ‘robo-taxi’ plans. If Tesla was to successfully launch an autonomous taxi service, it could disrupt Uber’s business model.
I expect Uber to give Tesla a run for its money in the robo-taxi space, however, given the popularity – and worldwide reach – of its app. I’m excited about the potential here.
Edward Sheldon owns shares in Uber Technologies
